Wealth, Greed and Misplaced priorities

Image Credit - www.oecd.org

In a span of 24 hours I came across two articles forwarded to my email id by Baskar. Both are disturbing and at the same time intriguing. They are disturbing because both touch upon the powerful and the super rich and how they manipulate the rules and the world to get even richer, all under government supervision. Intriguing because why on earth people owning yacht's, islands etc. would want to benefit from what governments earmarked for needy and how are they so insensitive to people lives when it comes to money.

The first article exposes the big black hole in American farm subsidy and how the super rich (likes of Rockfellers, Ted Turners etc) make the most of it. Between 1995- 2006, American government had spent $200 billion in farm subsidy and nearly 75% of it had gone to the super rich of America, who own farm lands. This besides the tax exemption they get from agricultural income and holdings. The word subsidy rings words like needy, for public benefit, support, protect in my ears. On what count the super rich deserve to avail farm subsidy, earmarked for true farmers? A billionaire worth $200 billion, availing $54,500 per annum as farm subsidy is a clear indication of a rot in the system. If this is what we can expect from America, just think of India and other developing countries.

The second article brings to light the effect of speculation in commodity derivatives. What effect? Death by starvation of millions of children in under developed and poor countries. This besides the impact on poor in all countries. Commodity derivatives came into existence with a purpose. It helped farmers and processors of commodities to hedge their risk of exposure to changing prices of commodities. On the other end it also helped buyers of these commodities to hedge their risk in fluctuating prices. Only when it moved beyond protecting real risks that the problems started. As long as real risk was hedged (involving farmers / processors, buyers of commodities) prices reflected expected supply and demand. But nowadays, irrespective of supply and demand it is the amount of investor (note, not farmer or buyer, investor) interest in a commodity that determines prices of commodities.

Speculation, where people without any risk in commodities are allowed to buy and sell commodity derivative products, is the main culprit of rising prices of commodities (Wheat, Coffee, Pulses, Wheat, Cotton, Oil etc) worldwide. Commodity exchanges nowadays primarily serve the interests of greedy investors more than needy farmers and buyers. The article linked here clearly establishes the link between speculation and price rise in commodities. Though it is organisations like Goldman Sachs that deal in commodity derivatives, they do it for high net worth individuals.

The wealthy wants to become more wealthy even if it means death of children in some East African nation. Many of these people can spend million a day for their lifetime and yet remain wealthy, without any additional income. A mere concentration on their businesses and their primary line of activity would ensure excellent growth of their wealth. Why on earth these rich people want to make profits in a market that acts as a barometer for commodity prices? It beats my understanding. May be the gambling pleasures. How else could this be explained. This world, its institutions, systems and the very structure of governance of the world (barring few countries) is made to make the rich richer and poor, poorer.

The least one could do now is to stay away from agents / brokers who chase us to invest our hard earned money in commodity derivatives.

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• How Goldman Sachs gambled on starving the world's poor - and won. (johannhari.com)

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Holy Cow! Or Shall We Say Holy NDTV (Or Something More Appropriate,,,)?

Hi guys, lay off Symmo, okay? He is totally sober and witty and so-right. And McCullum, don't get mad at me for saying Symmo is so-right. You are, what? Real Cow!

Read this apology: 

"I, Chyetanya Kunte, hereby tender an unconditional apology to Ms. Barkha Dutt, Managing Editor, English News, NDTV Limited and to NDTV Limited, for the defamatory statements I made regarding Ms. Barkha Dutt and NDTV Limited, in my post titled 'Shoddy Journalism,' dated November 27th 2008, on my weblog at www.ckunte.com."

It seems NDTV has got an unconditional apology from a blogger for making defamatory remarks. How's that?

Next time you see The Big Fight of something,  would it be a good idea to sue NDTV for anything anyone said- if you think it is unsubstantiated, may be you think it right to accuse them of lack of ethics, responsibility and professionalism in that they went ahead and aired it without verifying it all. But don't even think about that. NDTV is Hundred Per Cent Patriotic. 

Have you seen all those Jawan shows with film stars and all? That is how Patriotic they are and you have to appreciate that they uphold democratic values like equality, freedom of speech etc (you think they admire men in uniforms for their uniforms? Don't even think of it, no sir, censorship and dictatorship would never cross their mind, what do you think they are- Mushy?)

Read about it all with plenty of links at Desipundit

Socially Responsible Governance

In view of what is happening in the business world, The Financial Chronicle has reprinted our PM's ten point Social Charter in today's issue. He had read it out at CII's annual meeting on  May 24, 2007.

It makes entertaining reading.

Here are the highlights, but the full text is available here at this PIB release

• First, have a healthy respect for your workers and invest in their welfare. In their health and their children’s education, give them pension and provident fund benefits, and so on. 
• Two, corporate social responsibility must not be defined by tax planning strategies alone. Rather, it should be defined within the framework of a corporate philosophy which factors the needs of the community and the regions in which a corporate entity functions
• Three, industry must be pro-active in offering employment to the less privileged, at all levels of the job ladder. The representation companies give to Scheduled Castes, Scheduled Tribes, other Backward Classes, Minorities and Women, in their workforce and staff must increase. 
• Four, resist excessive remuneration to promoters and senior executives and discourage conspicuous consumption. In a country with extreme poverty, industry needs to be moderate in the emoluments levels it adopts. Rising income and wealth inequalities, if not matched by a corresponding rise of incomes across the nation, can lead to social unrest. The electronic media carries the lifestyles of the rich and famous into every village and every slum. 
• Five, invest in people and in their skills. Offer scholarships to promising young people. Fill young people with hope in their future. High rates of growth mean nothing for those who are unable to find employment. We must invest in skill-building and education to make our youth employable
• Six, desist from non-competitive behaviour. The operation of cartels by groups of companies to keep prices high must end.  It is unacceptable to obstruct the forces of competition from having freer play. It is even more distressing in a country where the poor are severely affected by rising commodity prices.
• Seven, invest in environment-friendly technologies. India's growth must be enhanced and, yet, our environment and ecology must be protected and safeguarded for our future generations.
• Eight, promote enterprise and innovation, within your firms and outside. If our industry has to make the leap to the next stage of development, it must be far more innovative and enterprising. The success story of the last two decades has been the emergence of a large number of first generation enterprise.
• Nine, fight corruption at all levels. The cancer of corruption is eating into the vitals of our body politic. For every recipient of a bribe there is a benefactor and beneficiary. Corruption need not be the grease that oils the wheels of progress
• Ten, promote socially responsible media and finance socially responsible advertising. 
  

Wonder what stops the Government from practicing what it preaches?